Sunday, May 17, 2009

An extra £2m for MSPs at Holyrood while Westminster’s reputation withers in expenses scandal

Lately with all the scandal over MPs at Westminster raiding the public purse for everything from umbrellas to swimming pool boilers, the Scottish Parliament has been trying to hold itself up as a model of responsibility on politicians expenses. We in Scotland know otherwise. (Yes we certainly do ! – Ed).

SENIOR MSPS were last night desperately trying to cling on to almost £2 million of profits tied up in their publicly-funded second homes. After priding themselves on a model expenses system, some of Holyrood's leading politicians were trying to gag debate over the last big perk for MSPs - the ability to sell their second home and keep any profit.

The Sunday Herald has learned SNP chief whip Brian Adam and minister for parliamentary business Bruce Crawford advised MSPs against talking to the media about the issue, in what one senior SNP worker called an atmosphere of "blind panic".

Of the 28 MSPs currently charging taxpayers for the cost of mortgage interest on a second home in Edinburgh, 12 are Nationalists, half of whom are cabinet secretaries or ministers. They include finance secretary John Swinney and housing minister Alex Neil, who would make profits of £95,000 each if they sold up.

Following a critical review of the practice last year, all mortgage interest claims will stop in 2011. The end of the perk is expected to trigger a wave of house sales as MSPs switch to renting and staying in hotels instead of using a second home.

Five MSPs would turn profits of more than £100,000 if they sold their homes tomorrow because of a long-term rise in values, according to valuations that the Sunday Herald asked a leading Edinburgh estate agent to place on the properties in the capital.

Former Liberal Democrat leader Nicol Stephen would make a profit of £200,000, or almost four times his salary, while presiding officer Alex Fergusson would make £125,000.

Brian Adam, the whip who is advising Nationalist MSPs to stay silent, would make £120,000. Alex Salmond last night said Holyrood "has shown Westminster the way forward in the row over MPs' expenses".

However, the first minister's spokesman refused to give his view on profits from house sales, dismissing the subject as "a legacy issue". Between them, the 28 MSPs are currently sitting on a £1.7m nest egg built up using parliament's Edinburgh Accommodation Allowance, with around £800,000 of it in homes owned by SNP MSPs. In light of the crisis over expenses at Westminster, MSPs now face calls to repay part or all of any profit made to the taxpayer.

Last week Nick Clegg, the UK leader of the LibDems, said his MPs would hand back any profit made by selling second homes in London.

However, Tavish Scott, the Scottish LibDem leader, who stands to make £120,000 on his second home in Edinburgh, said MSPs would not follow suit, pointing out last year's review of expenses decided it was too complicated to work. But Clegg's call has put Liberal Democrat MSPs on the spot, and alarmed other parties as well.

According to SNP sources, Crawford and Adam contacted Nationalist MSPs to tell them not to be drawn on the subject. "It's a blind panic. It's Crawford and Adam doing the phone round. They're saying, We have people involved'. It's a case of battening down the hatches," said one source.

The Sunday Herald has also obtained an internal memo sent by the SNP press office to MSPs on Thursday about second home profits. "I advise that you don't get into that issue," wrote head of communications Liz Lloyd. It is understood the five LibDem MSPs involved held an emergency meeting at Holyrood on Thursday to agree a line on defending non-repayment.

However, one LibDem MSP told the Sunday Herald: "Personally, I don't know how they can sleep at night. They're having a panic attack and hiding behind the independent review.

"Given the scale of the profits, I doubt if any of them could lay their hands on that kind of money in any other way. It's not beyond the wit of man or woman to work out a method of compensating the public purse for some of it."

MSPs currently earn £55,381 a year in salary. Ministers receive an extra £26,069 and cabinet secretaries an extra £41,618. The Scottish parliament is expected to publish the latest quarterly expense claims this week.